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Why Caps on Pain and Suffering Might Be Met with Court Challenge

Sept. 12, 2019
3 mins
An older couple calculate their expenses together at the table

Lawyers in Toronto are looking at challenging Ontario's cap on claim payouts for pain and suffering citing changes in deductible amounts and payout structures as a justification.

Allen Wynperle, president of the Ontario Trial Lawyers Association (OTLA) and a personal injury lawyer in Ontario, says Canada’s ceiling on pain and suffering damages can be challenged. Considered non-pecuniary damage, the cap was set up to block exaggerated liability claims.

The problem with the cap was that it was subject to change with inflation. That means by today’s rates, the $100,000 cap is closer to $350,000. Were a judge to lift the cap, liability insurance claims might increase to more than $400,000 for any non-pecuniary damages.

What are non-pecuniary damages?

Non-pecuniary damages are damages that can't be calculated like a medical bill or car repair bill. Non-pecuniary damage covers intangible losses resulting from psychological or physical pain (suffering permanent nerve damage, PTSD) or from a loss of life expectancy (being disabled after an accident).

The 1978 ruling

In 1978, a cap of $100,000 was placed on any pain and suffering awards for losses that are considered non-economical. This does not apply to expenses for medical treatments or rehabilitation. It also wouldn’t affect loss of income or if the person required an attendant’s care. The ceiling was established at the time because it was thought that plaintiffs would receive their full compensation from their other losses, i.e., areas outside of pain and suffering. But the OTLA says that is no longer the case.

Cap limitations

When a person sets up their auto insurance policy, their liability insurance is what protects them from injury claims and property damage if there's an accident. Personal injury claims can include pain and suffering.

The concern though is that the cap doesn’t hold up well when it comes to car accident claims. Campisi Law said the Ontario deductible for pain and suffering is now set at $38,818.97. If a plaintiff is then awarded $39,000 for their car accident case, they would only receive $181.03 after the deductible is met. Outside of Ontario, the deductible amount is lower. In Newfoundland and Labrador, for example, the deductible is currently $2,500 but it might increase to $5,000 at some point.

Cap found unconstitutional in the U.S.

In the U.S., there’s a state law cap on pain and suffering in Kansas. It was established to set limits on insurance costs, said Rick Wilborn, a State senator there.

But the Supreme Court found the cap on damages as unconstitutional. A woman was injured in a vehicle accident that occurred in 2010. The jury gave an award of $301,509 and that was for Diana Hilburn’s non-economic losses. But, the ceiling was set at $250,000. Kansas’s Supreme Court then ruled that the damage cap was violating Hilburn’s rights as it relates to a jury trial.

Right to a jury trial

Challenging the cap on pain and suffering might look like it’s interfering with a jury’s duties. They are responsible for setting the amount for non-pecuniary damages in the U.S.

But, in Canada, the right to a jury pertains to certain cases. Canada’s legal system uses the Canadian Charter of Rights and Freedoms. This means a jury trial is available for any defendant that is facing five years of prison time or more.

With civil cases in areas like Ontario, there might be a right to a jury trial. In instances like this, the jury should be the ones deciding on what to allow for non-pecuniary damages themselves, not the cap. The justification for the cap in 1978 comes from three rulings:  Andrews v Grand & Toy, Teno v Arnold, and Thornton v School District No. 57.


The RATESDOTCA editorial team are experienced writers focused on sharing stories and bringing you the latest news in insurance and personal finance. Our goal is to provide Canadians with the information and resources they need to make better insurance and financial decisions.

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